Net position in proprietary funds is typically reported in which form?

• A. The net position is only a single number
• B. It is called net assets rather than net position
• C. It is reported as net position in the statement of net position
• D. It does not include capital assets

Answer: (C)

Proprietary funds use accrual accounting and are presented similarly to business-type activities, so their resources are shown in a dedicated financial statement called the statement of net position. The amount reported is the net position, which is assets and deferred outflows minus liabilities and deferred inflows, and it reflects the fund’s remaining resources after obligations. This form is the norm because the term used for these funds is net position, not net assets, and the total net position is presented on the statement of net position along with its components (such as net investment in capital assets, restricted, and unrestricted). Capital assets are indeed included in the net position calculation, so it wouldn’t be correct to say they aren’t included.